Homeowners who are interested in moving from their current homes are faced with more choices than ever. No matter your reason for moving, you’ll have to do something with your current property, and you have two choices for what to do: you can sell it or you can rent it out.
Renting your home in Lloydminster, rather than selling it, can be a great investment option and can bring in some extra cash. But there are several things to consider before you make the decision to rent your home rather than selling it. Here’s what you need to ask yourself.
1. Are you ready to be a landlord? Being a landlord is a big responsibility since you’re dealing with people’s living situations. Like any job, it does take time and energy in the form of finding tenants and then ensuring that they’re happy and that the property is in good condition.
2. What will your cash flow be if you convert to a rental? A rental property is first and foremost an investment. If it’s not going to be profitable, you are much better off selling. This is the time to pull out your calculator and do some math. Make sure that your rental income will be enough to pay the mortgage, taxes, and HOA along with taking care of repairs/maintenance, all while still making a profit.
3. Can you break even on a sale? After you’ve done the math on the rental, do some calculations on selling your home for comparison’s sake. You’ll want to see if selling the home would get you more money than the profit margin on renting would give you after a certain number of years.
4. What rules do you need to follow for an investment property? Rentals are typically regulated by laws, lenders, and taxes. Make sure you know what the rules and regulations are for a rental property in your area and factor any extra taxes or costs into the above calculations.
Once you answer these questions, you’ll have a clearer idea of which option is the best for you. Being an expert real estate agent in Lloydminster, I can walk you through the different things to consider and help you with the calculations to make the best decision for your future. Feel free to contact me, and I’ll get you the necessary information!
RE/MAX of Lloydminster